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European markets fall into red as US impeachment looms

European markets fall into red as US impeachment looms

Logo of the London Stock Exchange

LONDON: Most European and US markets slumped on Thursday (Dec 5) after an upbeat start to the day was eroded by news the US Congress is moving ahead with impeachment efforts against President Donald Trump.

House Speaker Nancy Pelosi ordered articles of impeachment to be drawn up that could lead to a trial in the Senate, saying Trump's abuse of power for political benefit "leaves us no choice but to act".

Trading had been in positive territory on renewed hopes for China-US trade talks after a report said a deal could be finalised by the end of next week.

British stocks were nonetheless held back also by a rise in the pound's value against other major currencies, which limits profits at companies that earn substantial amounts of their revenues in US dollars.

The pound was in demand as polls suggest that Prime Minister Boris Johnson's Conservatives would win a majority at next week's general election, giving him a mandate to push through his Brexit agreement and avert a no-deal divorce.

"For markets, anything other than a Conservative victory would be deemed as a negative, with a hung parliament leaving Johnson scrambling to form a government with parties which have rejected the deal Boris is pushing," noted Joshua Mahony, a market analyst at the online trading group IG.

The latest developments appeared to overtake the markets' roller-coaster reactions to reported developments in the Chinese-US trade saga.

They also countered any positive effects from news that the US trade deficit in October unexpectedly fell to its lowest level in more than a year as consumers purchased many fewer autos and consumer goods.

In commodity markets, world oil prices rose further after surging on Wednesday on reports that OPEC and other major producers were ready to announce fresh output cuts.

Faced with slowing global economic growth and abundant reserves putting pressure on oil prices, OPEC and its partners could seek to deepen output cuts when they meet in Vienna on Thursday and Friday.

The cuts of 1.2 million barrels per day from October 2018 levels were originally fixed in December last year and were already extended at OPEC's last meeting in July.

Some observers expected the cuts to remain in place possibly until the end of 2020.

Key figures around 1545 GMT:


London - FTSE 100: DOWN 0.7 per cent at 7,137.85 points (close)

Frankfurt - DAX 30: DOWN 0.7 per cent at 13,054.80 (close)

Paris - CAC 40: FLAT at 5,801.55 (close)

EURO STOXX 50: DOWN 0.3 per cent at 3,648.13


Tokyo - Nikkei 225: UP 0.7 per cent at 23,300.09 (close)

Hong Kong - Hang Seng: UP 0.6 per cent at 26,217.04 (close)

Shanghai - Composite: UP 0.7 per cent at 2,899.47 (close)


Pound/dollar: UP at US$1.3160 from US$1.3104 at 2200 GMT

Euro/pound: DOWN at 84.35 pence from 84.54

Euro/dollar: UP at US$1.1104 from US$1.1078

Dollar/yen: DOWN at 108.67 from 108.86 yen


Brent North Sea crude: UP 1.1 per cent at US$63.68 per barrel

West Texas Intermediate: UP 0.4 per cent at US$58.86 per barrel

Source: AFP/de


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